The Executive Board of the International Monetary Fund (IMF) today completed the fourth review of the Extended Credit Facility arrangement for Benin and approved the immediate disbursement of SDR 10.61 million (about US$16.2 million). The Executive Board also concluded the 2012 Article IV consultation with Benin, which will be covered in a separate Public Information Notice in due course. Today’s decision will bring to SDR 53.06 million (about US$81.1 million) the total disbursed under the SDR 74.28 million Arrangement, which was approved in June 2010 (see Press Release No. 10/243).

At the conclusion of the Executive Board’s discussions, Min Zhu, Deputy Managing Director and Acting Chair, made the following statement:

“Benin has made significant progress in consolidating macroeconomic stability under the Fund-supported program. Economic growth is projected to maintain its pace, inflation remains in check, and the external current account deficit has been broadly stable.

“All quantitative performance criteria and targets were met, but earlier reforms to the cotton sector and a key component of the customs reform program have been suspended.

“Prudent fiscal policy has kept fiscal deficits at manageable levels and is projected to yield a basic primary surplus in 2012. Public debt remains low at about 32 percent of GDP. However, looking forward, it will be important to contain current expenditures, including on public sector wages, to provide space for infrastructure spending and meet medium-term fiscal objectives. Broad based-customs reforms will strengthen revenue collection. In this context, a well-designed reimplementation of the import-verification program will be important going forward.

“Improvements to the business climate and public investment will be necessary to boost external competitiveness and economic growth. Further progress on structural reforms, including implementation of a revised framework for the cotton sector, remains thus critical.”